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Budget 2024: How Union budget is prepared? Explained in 7 points
Union budget document is presented in the lower house of Parliament, Lok Sabha, on February 1.
The budget is an annual financial statement that lays out the government’s proposed expenditures and revenues for the upcoming fiscal year, which begins on April 1st and ends on March 31st of the following year.
The budget is presented by the union finance minister in the Parliament. The budget is a comprehensive document that outlines the government’s economic and fiscal policies for the next fiscal year.
How is the budget prepared?
1. The fiscal year runs from April 1 to March 31, requiring parliamentary approval of the budget before April 1.
2. The budget process starts six months before the financial statement is presented in Parliament, commencing deliberations in August-September of the previous year.
3. Ministries receive a circular to prepare estimates, followed by extensive consultations with Niti Aayog, and approved data is sent to the finance ministry.
4. The finance ministry allocates revenues to departments; disputes go to the prime minister or Union cabinet for resolution.
5. The finance minister engages in pre-budget meetings, discussing proposals and demands with stakeholders, finalising decisions with the prime minister.
6. Before the budget presentation, a 'halwa ceremony' is held, initiating a 'lock-in' for ministry staff to prevent leaks, lasting until the financial statement is tabled.
7. The budget document is presented in the lower house of Parliament, Lok Sabha, on February 1, a shift from the previous practice before 2017 when it occurred on the last day of February.
Also read- Explained: What is Union Budget, its constitutional provisions
What is the importance of Budget?
The Indian budget is closely watched by businesses, investors, and the general public as it provides insight into the government’s economic policies and priorities and can have a significant impact on the economy and people’s lives.
